Here are estimates on total residential short-term rental tax revenue for counties in the U.S. with major short-term rental markets, including estimates on collectable residential short-term rental taxes.
I have covered short-term rentals at Skift for a little over six months now, and in reporting on regulations around the world with its when will the hammer come down conjecture, I figured my time would be well-spent trying to understand some of the incentive behind the intention to regulate.
And so, I did what most journalists do — follow the money — and reached out to Nick Del Pego, CEO of Deckard Technologies to get some tax data. San Diego-based Deckard Technologies partners with local communities and counties to provide them with data and analytics to identify and tax short-term rentals.
Below are the company’s estimates on total residential short-term rental tax revenue for counties in the U.S. with major short-term rental markets, including estimates on collectable residential short-term rental taxes.
Computing this data did not come without challenges: In some jurisdictions it’s fairly straightforward as there is one tax rate for the county. In other jurisdictions, such as San Diego, for instance, there are 19 different taxing authorities, and so the rate Deckard Technologies uses is an average across the area.
Here are a few caveats from Deckard Technologies to interpreting this data: “We have been inclusive of the various tax rates levied (many jurisdictions have local, state, occupancy and sales taxes that combine to the rate in the below table). Also, we’ve calculated the potential collectible combined accommodations tax, but we wouldn’t expect the actual collected tax to equal this amount as some amount of transactions will go unreported or underreported,” Del Pego wrote. “Lastly, we do not have information on what the jurisdictions actually collected — very few of the jurisdictions publish this information and gathering it would be achievable, but only through a lot of freedom of information requests to each of the many taxing authorities involved.”
But even so, these are an unsurprising list of very large and popular vacation destinations that all have substantive tax rates. The dominant ones are Hawaii, Florida and California. The lone outlier was Sevier County, Tennessee, which is home to Great Smoky Mountains National Park, one of the busiest in the world, with an estimated 13 million visitors in 2022.
Estimated 2022 Revenue and Taxes By State/U.S. County
|Combined Tax Rate
|Estimated Collectible Taxes
All $ amounts in millions
Expedia Terminates the Vacation Rental Flow to Hopper
Expedia terminated its supplier relationship with Hopper Wednesday, meaning Expedia/Vrbo-sourced vacation rentals will no longer be available to Hopper and its distribution partners, including Capital One. The same goes for the hotel inventory that Expedia has supplied to Hopper over the last five or so years, as well.
Hopper responded to the news, saying it has a diverse array of vacation rental providers. Property manager Evolve is one of Hopper’s suppliers with around 24,000 homes. Hopper Homes claims to offer 4 million properties so Expedia’s exit doesn’t seem to be an existential blow in terms of vacation rental supply.
Exclusive: Expedia Terminates Its Hopper Relationship, Says It ‘Exploits Consumer Anxiety’
More Legal Hassles for Airbnb
A landlord in Toronto is suing her former tenant, along with her boyfriend, the City of Toronto, and Airbnb, after the landlord’s downtown condominium was allegedly rented out on Airbnb without her knowledge or consent for several months.
The lawsuit accuses Airbnb and the city of facilitating the registration and rental process without properly verifying the legal authority of the tenants to engage in short-term rentals. Seeking $1.6 million in damages, the lawsuit claims financial losses, mental anguish, and other harms.
It should be noted that these allegations have not yet been proven in court, and no statements of defense have been filed by the defendants. The lawsuit points out that the property listing has received more than 30 reviews, indicating that it has been rented out at least 30 times while it was listed.
Who Is Skirting the Law in Canada?
The City of Vancouver may have had regulations in place for short-term rental housing since 2018, but there are now concerns about how it enforces these regulations. According to city statistics, there appears to be an increase in the number of renters disregarding the law. This year alone, Vancouver has already identified 54 licenses for audit, dispatched 35 warning letters, and released 69 legal orders.
According to the city’s regulations, only the resident of a housing unit, whether they are the owner or tenant, can offer short-term rentals. This applies to secondary suites in basements, but only if the operator lives in that specific unit and it serves as their primary residence. It is not permissible if the operator resides in another dwelling unit on the property.
In 2020, the city issued 3,466 business licenses for short-term rental operators, estimating a compliance rate of 78 percent by dividing that figure by the total number of listings on the market. By March 2023, the number of business licenses had fallen to 2,597, while active listings reached 3,524, resulting in a compliance rate of 74 percent. Recent statistics, updated last week, reveal 4,084 active listings and 2,802 business licenses, indicating a decreased compliance rate of 68 percent.
Airbnb’s March Towards Japan
Airbnb co-founder and Chief Strategy Officer Nathan Blecharczyk believes private vacation rentals can help alleviate the staffing challenges faced by Japan’s hotel industry in accommodating the post-Covid resurgence of foreign tourists.
Blecharczyk emphasized the interest in travelers exploring beyond cities and highlighted the potential of private vacation rentals to cater to tourists. The number of people staying in registered private lodgings in Japan increased by approximately 80% in February and March compared to the previous year. Airbnb has partnered with localities and organizations in Japan to encourage more hosts to join the platform and has plans to convert abandoned houses into lodgings, leveraging the abundant vacant homes in the country.
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